Management consulting may not seem like a particularly dangerous line of work, but consultants in this space face as many risks as personal trainers or family therapists. Each of these professions offers solutions to client problems based on their knowledge and experience. Occasionally those solutions don’t work, or may even cause harm – whether it is physical, emotional and financial. But even though the advice management consultants give their clients is aimed at boosting their business, there may be one who is dissatisfied enough to purse legal recourse, with potentially devastating financial implications.
Like football, in management consulting the best offense is a good defense – defense against legal headaches, lost time and unnecessary expense. And the best tools for the job are professional liability insurance and general liability insurance protection.
Also known as errors and omissions or E&O, professional liability insurance shields your management consultancy from allegations of erroneously-provided service and client financial loss as a result of heeding your advice. It protects your business if you are sued for negligently performing your services even if you haven’t made a mistake, and covers your legal defense and financial compensation for your client, up to policy limits.
Let’s say you’re hired to improve operational efficiency in a multi-location financial planning firm. You create several programs to streamline the reporting structure more and speed up decision making capabilities. But since only three of the firm’s five locations implement your plan, it doesn’t produce the predicted improvements – and the client sues for compensation. An E&O policy would defend you.
General liability insurance deals with the more concrete issues that may arise in the course of your work, such as instances of bodily injury or property damage at your location or your client’s. If a client trips and falls while at your office and breaks a bone, your general liability coverage steps in to defend you and pay damages. Or maybe during a presentation in a client’s conference room your whiteboard falls forward, landing on someone’s cell phone and breaking the screen. General liability coverage will take care of the repair or replacement.
Another option for getting the general liability coverage your need is a Business Owners Policy (BOP). These policies combine general liability coverage and property insurance that protects your business property against physical loss or damage. Since a BOP combines two coverages for one price it’s a cost-effective way to get general liability coverage and property coverage without spending much more in premiums. No one expects an accident, but everyone is at risk; make sure you’re protected.
Aside from helping in instances like those above, having small business is also important for growing your company. Many corporate clients require you to have both professional liability and general liability coverage before they’ll enter into a service contract with your firm. It’d be a shame to miss a great opportunity because of this, so start your small business insurance quote today.